Parkin IPO: UAE retail offering increased on strong demand

Image courtesy: KARIM SAHIB/ Getty Images

Dubai’s Parkin, which oversees public parking operations in the city, has increased the number of shares allocated to retail investors for its initial public offering (IPO) on robust investor demand and oversubscription.

The company increased the allocation of retail investor shares to 89,964,000 ordinary shares from 74,970,000 ordinary shares after receiving approval from the Securities and Exchange Authority.

Earlier in March, Parkin set the price range for its planned IPO at Dhs2 to Dhs2.1 ($0.57) per share. Based on the indicative share price of as much as Dhs2.1 apiece, the company is set to raise Dhs188.92m from the retail tranche, equivalent to 12 per cent of the total offering.

The total offering size remains unchanged at 749,700,000 shares, equivalent to 24.99 per cent of the firm’s paid-up capital.

The parking firm said following the increased allocation to retail investors, the qualified investor’s tranche will decrease to 659,736,000 shares, equivalent to 88 per cent of the total offering.

“The IPO will enable us to build on and accelerate our success; driving further innovation, delivering strong financial performance, and realising the potential of our growth platform to scale up and diversify,” Mohamed Al Ali, the company’s CEO said in a statement.

The subscription period of the IPO remains unchanged, and it will end on March 12 for UAE retail investors and on  March 13 for domestic and international institutional investors.

The listing of the company’s shares on the Dubai Financial Market is scheduled for March 21.

Parkin joins Dubai IPO frenzy

Meanwhile, Parkin’s IPO is the sixth privatisation by the Dubai government as part of a plan, unveiled at the end of 2021, to list 10 state-owned companies as the emirate seeks to deepen its capital markets.

The company operates about 197,000 paid public parking spaces across Dubai as of the end of last year, of which 4,000 or so were at multi-storey car parks. It also manages an additional 18,000 spaces at developer-owned facilities.

The parking firm plans to pay a minimum dividend of either 100 per cent of profit or free cash flow to equity for the full 2024 fiscal year, depending on which is higher. Its revenue grew by 14 per cent in 2023 to Dhs779m

Founded in 2023, Parkin’s 49-year concession agreement with the Roads and Transport Authority gives the company exclusive rights to operate all paid public on-street and off-street parking in the emirate.

Read: Dubai’s Parkin sets IPO price range of up to Dhs2.1 per share